TLDR
- X now bans apps from rewarding posts with tokens, points, or cash via its API.
- Cookie DAO shut down and Kaito is moving to influencer marketing.
- Paul Graham and other users called AI-generated replies a “plague.”
- X will continue to allow crypto and Web3 use, just not reward-based posting.
X, the social media platform previously known as Twitter, has updated its developer API policies. The change now blocks apps that pay users for content or engagement. The decision is aimed at reducing AI-generated spam and low-effort engagement tactics across the platform.
https://twitter.com/DegenerateNews/status/2011843729464652286?s=20
Many X users, including public figures, welcomed the update. Y Combinator founder Paul Graham referred to AI-generated replies as a “plague.” Others in the crypto and tech sectors supported the move as a step toward cleaning up user timelines.
InfoFi Projects Shut Down or Change Direction
The new rules have caused InfoFi-based apps to close or adjust their business strategies. InfoFi, short for “information finance,” is a model where users are paid to post or amplify trending topics.
Kaito, an InfoFi platform that rewarded users with tokens for reposting trending content, announced it would end its token model. The company will now focus on a traditional influencer-marketing structure. Cookie DAO, another InfoFi project, confirmed it would sunset its platform after its token dropped sharply.
“After discussions with X, it’s agreed that a fully permissionless distribution system is no longer viable,” said Kaito founder Yu Hu.
Xeet, a campaign-based content app, paused operations to assess its future. While it claimed not to be a full InfoFi platform, it acknowledged being affected by the rule change.
Developers Respond to New API Guidelines
X stated it still supports crypto and Web3 projects through its API, just not those that financially reward posts or replies.
“There are incredible use cases for CT and crypto/Web3 with X API which we will continue to support,” said Chris Park, a developer at X.
X product chief Nikita Bier and other platform insiders had criticized the InfoFi model before the rule change. In a deleted post, Bier said that crypto posts were flooding timelines with low-quality replies like “gm” messages, reducing overall value for users.
Nic Carter from Castle Island Ventures added, “You create a financial incentive for someone to post, it creates more of it. Combine this with AI you get tons of slop.”
Engagement Incentives Remain a Concern for Some
Some developers and users questioned the move, arguing that X still pays creators based on engagement from premium users. They believe that as long as any financial incentive exists, users will try to exploit it.
“Elon ruined X when it began to incentivize posting,” said 0xErod, marketing lead at Symbiotic. “People will continue to publish slop as long as there are financial incentives.”
Despite the shutdown of some platforms, others like Noise claim to be unaffected. Noise recently raised $7 million and uses a different data model for its platform. The team said its systems rely on attention metrics, not tokenized posting incentives.
